Kellanova (K)

If you are holding a capital gain, he would consider taking some profit. There is commodity pricing pressure with distribution issues. He would move on to greener pastures.

The only things working this year is everything that is defensive. On the back of that, this company has seen some nice price movement. 50% of their revenue comes from cereals, so the whole trend of people trying to get away from carbs isn’t really helpful to them. A good quality company. She doesn’t see a ton of upside.

His model price is $59.28, a negative 8%. These are wonderful names in a portfolio and he thinks they go sideways. If it got a nice downdraft year, he would be a buyer of the stock. 3% dividend yield.

General Mills (GIS-N) or Kellogg’s (K-N)? Primarily focused on what he considers junk food. The consumer has become more educated. His concern with this company is that they have not adapted to the healthy consumer preference. Put up almost $2 billion in debt a few years ago to buy Pringle. If you look at the cash flow that goes to servicing that debt and their dividend, there isn’t a lot of cash for new growth catalysts. General Mills would be his preferred play.

(A Top Pick April 22/14. Down 7.3%.) Broke below a head and shoulders pattern yesterday. The period of seasonal strength generally is from April through until November. It is definitely time to step aside and get out if you own.

Would be careful of this because people are eating less cereal. The next generation are carbohydrate conscious so cereal demand is not going in their favour. Trading at a high valuation.

Best seasonal stock around right now. Upward trend, above 20 day moving average and outperforming the average, so it is a buy.

This is your classic defensive play. A consumer staples company that has a low PE of about 13 as opposed to the market which is about 17. The period of seasonal strength for this can run between now, April through to July. Consumer Staples in general can do well all the way through to October. The average gain from April 27 to October 7 is 9.18%. On the technicals, the chart shows what he would call a bit of a Bull flag. This sharpness has come on during takeover talks, but he is not playing it on this basis, but on a seasonal basis.

Cereal business is a fairly slow grower and not that robust right now. He would be a little bit concerned as it is trading at about 16 or 17 times earnings but growing at well less than half that.

(Market Call Minute.) Made a nice acquisition with Pringles and we'll see if that does anything with their earnings, which haven't gone anywhere in the past couple of years.